The question that most mutual fund investors focus closely on is which fund they should invest in. This is especially true for new investors. However, this is the wrong question, at least in the beginning. In fact, focusing on getting the answer to this question will inevitably lead us down the path to making the wrong choice.
Actually, the most important question is, what type of fund should you invest in. In the parlance of mutual fund investing, which fund category or categories should you invest in. That’s the complicated but important question and once that’s decided, choosing the exact mutual funds is simple enough. Well, at least it’s much simpler.